Assignment on HRM

Topic: Comparison HR Practices of two Organizations

Submitted to: Submitted by:

MrS. Jaschetan kaur Gaurav Saini
MBA (R1003)
Roll No.-B32
 HUMAN RESOURCE POLICY- NESTLE

A shared Responsibility

Each employee has a distinct responsibility in dealing with people be it as a leader of a team or
as a peer.
HR managers and their staff are there to provide professional support in handling people
matters but should not substitute themselves to the responsible manager. Their prime
responsibility is to contribute actively to the quality of HR management throughout the
organisation by proposing adequate policies, ensuring their consistent application and coherent
implementation with fairness. Acting as business partners, the HR manager advises and offers
solutions which results in positive impact on the organisation effectiveness.

Furthermore, she/he proposes best practices and provides state-of-the-art support and
counselling to her/his colleagues. Together they act as co-responsible partners for all HR
matters.

This partnership is the key for efficiency in people management.

The communication skills of the HR staff must be appropriate to deal with all delicate matters
as they occur frequently in human relations issues. They gain their credibility not only from
their professional contribution but also through the care and the excellence of their
communication skills.

Dealing with People

The Nestle Management and Leadership Principles describe the management style and the
corporate values of the Nestle Group, specifically in the area of interpersonal relations. Their
respect calls for specific attitudes which deserve to be outlined in the present policy: _ A
prerequisite for dealing with people is respect and trust. There can be no room for intolerance,
harassment or discrimination of any kind as they are the expression of an elementary lack of
respect. This principle suffers no exception and is to be applied at all levels and under all
circumstances. _ Transparency and honesty in dealing with people are a sine qua non for
efficient communication. Based on facts and on a sincere dialogue, such transparency is the
only solid basis for boosting continuous improvement.

This is to be complemented by open communication with the purpose of sharing competencies

and boosting creativity. It is particularly relevant in a flat organisation to convey systematically
all information to those who need it to do their work properly. Otherwise no effective
delegation or knowledge improvement is possible. To communicate is not only to inform. It is
also to listen and to engage in dialogue. Every employee has the right to an open conversation
with superiors or colleagues. _ The willingness to cooperate and to help others is a required
basis for assessing potential candidates in view of a promotion. _ In case of discord between an
employee and her/his superior or another employee, the possibility must be offered for a fair
hearing. The HR staff will provide assistance to ensure that the disharmony is dealt with
impartially and that each party has the opportunity to explain her/his viewpoint regardless of
hierarchical position.
Joining Nestle

The long-term success of the Company depends on its capacity to attract, retain and develop
employees able to ensure its growth on a continuing basis. This is a primary responsibility for
all managers. The Nestle policy is to hire staff with personal attitudes and professional skills
enabling them to develop a long-term relationship with the Company.

Hence, a clear communication of these principles and values from the very beginning of the
recruitment process is required. Those who are not willing to adhere to the Corporate Business
Principles and/or to the Nestle Management and Leadership Principles cannot be part of the
Company, as both these documents express the basic values and principles of the Organisation.
Moreover, for managerial positions specific leadership qualities and business acumen will be
required. Nestle wishes to maintain and develop its reputation as an employer of high repute.
Contacts with universities, attendance at recruitment events and other contacts are to be
undertaken so as to ensure good visibility of the Company vis-Ã -vis relevant recruitment
sources. Particular care will be given to the treatment of each candidacy regardless of the
outcome of the selection process. Even when promoting employees intensively from within the
organisation, it is the role of management and HR to keep an eye on valuable candidates from
outside and to benchmark internal skills with external offers.

Therefore the potential for professional development is an essential standard for recruitment.
Each new member joining Nestle is to become a participant in developing a sustainable quality
culture which implies a commitment to the organisation, a sense for continuous improvement
and leaves no place for complacency. Therefore, and in view of the importance of these Nestle
values, special attention will be paid to the matching between a candidates values and the
Company culture.

Whilst adequate recruitment tools may improve the hiring process, it is understood that the
decision to hire a candidate remains in the hands of the responsible manager supported by the
HR staff. Under no circumstances should the decision to hire or not to hire be left in the hands
of an outside consultant or expert. As mentioned in the Nestle Management and Leadership
Principles, only relevant skills and experience and the adherence to the above principles will be
considered in employing a person. No consideration will be given to a candidate’s origin,
nationality, religion, race, gender or age. It is as important to hire the right person as it is to
integrate newcomers in the organisation so that their skills and behaviour can merge smoothly
with the company culture. Whereas from new employees it is expected to respect our
company’s culture, it is accordingly required from all employees to show an open mind towards
new ideas and proposals coming from outside.

Employment at Nestle

The Corporate Business Principles outline the Company’s commitment to fully endorse and to
respect a series of principles and international conventions concerning employee’s rights, the
protection of children against child labour and other important issues. These principles are to be
respected everywhere and under all circumstances. The management will implement the
necessary processes to ensure that these principles are enforced at all levels. Employees who
are not abiding with the Corporate Business Principles and the Nestle Management and
Leadership Principles cannot be maintained in employment and will be requested to leave the
organisation. Also our main suppliers and providers of outsourced services should be informed
of the Corporate Business Principles and should comply with those. Nestle provides a working
environment which protects the health and welfare of the employees according to the highest
affordable standards of safety, hygiene and security. Each employee should not only care for
her/his own safety but also that of her/his colleagues. Therefore, suggestions for improvement
are welcome and will be given prime consideration. In the same way that no discrimination for
reason of origin, nationality, religion, race, gender or age will be tolerated when joining Nestle,
no such discrimination will be tolerated towards Nestles employees.

Furthermore, any form of harassment, moral or sexual, will not only be prohibited but actively
tracked and eliminated. Internal rules and regulations will explicitly deal with discrimination
and harassment issues so as to obtain the best possible prevention. Nestle considers that it is not
enough to avoid discrimination or harassment. It is essential to build a relationship based on
trust and respect of employees at all levels. Therefore, it is indispensable for each manager to
know how her/his employees feel in their work. In larger units it may be necessary to organise
such feedback on a regular basis, using internal surveys or other valuable approaches. Nestle
favours a policy of long-term employment. Whenever, an operation/ activity cannot be
maintained within the Nestle sphere, reasonable steps will be undertaken to avoid overall loss
of employment by identifying an external business willing to take over activity from Nestle,
whenever this is possible. If this is not possible, a closing down may be unavoidable. It will be
handled in full respect of local legislation and of the Corporate Business Principles. A social
plan will be elaborated taking into account the legitimate interests of the concerned staff.
Reasonable efforts will be deployed to reduce, as much as possible, the negative social impact
of such a situation.

Work/Life Balance

At Nestle we believe that the employee private and professional life should have a good
balance. Not only because it reinforces employee’s satisfaction, loyalty and enhances
productivity but also because it positively reflects on the Company reputation. It helps
attracting and retaining people and reconciles economical imperatives with well being. Nestle is
willing to support employees who wish to take an active part in the life of the community or by
assuming responsibilities in professional, civic, cultural, religious or voluntary organisations it
being understood that any activity during working hours be first approved by the Company.

In the same spirit, Nestle encourages flexible working conditions whenever possible and
encourages its employees to have interests and motivations outside work.

Remuneration

Nestle favours competitive, stimulating and fair remuneration structures offering an overall
competitive and attractive compensation package. Remuneration includes salary, any variable
part of remuneration as well as social, pension and other benefits. Each operating company will
establish a compensation practice taking into account relevant external compensation levels as
well as the requirement of internal fairness. It is recommended to undertake regular surveys so
as to gather relevant information on the remuneration levels practised at a local or national
level. Nestlé’s policy is to strive to position itself as an employer offering remuneration levels
above the average of the relevant benchmark. Nestle reviews regularly its competitive position
with other companies so as to keep in line with the market trends. However, the evolution of
remuneration is in the first instance determined by the capacity of the Company to improve its
productivity. Wage and salary structures should be kept simple and avoid unnecessary
complexity so as to provide effective compensation and reward. Remuneration structures
should specifically facilitate the implementation of flat organisational structures and be flexible
so as to be able to adapt to the evolution of the market conditions. This means broad spans
allowing sufficient flexibility to effectively reward high professional insight and performances
as well as individual potential.

It is the responsibility of each manager to propose, within the framework of the company
policy, the remuneration of her/his employees, taking into account the local market, individual
performance, skills and potential for development. It is also the responsibility of each manager,
if needed with the support of HR management, to communicate properly, clearly and with
sufficient transparency, the individual remuneration of each staff member taking into account
her/his professional performance and her/his specific responsibilities. The quality of
communication in these matters is an essential part of the dialogue that each manager will have
with her/his employees on remuneration matters. Specifically at management level, the variable
part of the remuneration may be substantial. This part will be linked to a combination of group,
business and individual or team target achievements. The higher the remuneration level, the
more important will become the variable part. It should be realised that, however important
remuneration is for each employee, it is not remuneration alone that will stimulate the
motivation of the staff. The HR management sees to it that the implementation of the
remuneration policy is fair throughout the organisation and that its spirit is duly reflected.

Professional Development

Learning is part of the Company culture. Each employee, at all levels, is conscious of the need
to upgrade continuously her/his knowledge and skills. The willingness to learn is therefore a
non-negotiable condition to be employed by Nestle. First and foremost, training is done on-the-
job. Guiding and coaching is part of the responsibility of each manager and it is crucial to make
each one progress in her/his position. When formal training programs are organised they should
be purpose oriented and designed to improve relevant skills and competencies. Therefore they
are proposed in the framework of individual development programs. As a consequence,
attending a program should never be considered as a reward.

Great importance will be attached to programs enhancing the language skills of the employees.
Training programs organised at the International Training Centre Rive-Reine aim at developing
and sharing best practices of the various management disciplines practised in the Group. They
also strive to strengthen corporate cohesion as well as to promote networking throughout the
Group. Training programs should, as much as possible, be based on action learning and reduce
ex-cathedra teaching to the strict minimum. It is necessary to make optimal use of e-learning
programs as a complement to or a substitute for formal training programs. According to needs
they should be made available at shop floor level and enlarge the access to training. It is the role
of each manager to assess progress achieved as a result of training programs.
Adequate training programs are developed at the level of each operating company capitalising
on the availability of local, regional or global resources of the Group. It is the responsibility of
HR staff to assist the management in the elaboration of training programs.

Assessing and Developing Each employee is in charge of her/his own professional

development. However, the Company endeavours to offer the opportunity to progress for those
having the determination and the potential to develop their capabilities.

Such opportunities should take into account the potential of each employee and be discussed
with transparency. They will be based on defined possibilities, concentrate on the next career
step and not on vague promises or remote hypotheses. The Company encourages its employees
to express their objectives and expectations in an open dialogue. The objective is to retain and
motivate employees by offering attractive but realistic career moves allowing them to develop
their skills over a long-term period within the framework of economic reality and a changing
environment. Whereas succession plans forecast the Company needs, they will be reconciled,
inasmuch as possible, with individual development plans. HR management provides the support
for implementing the necessary planning tools, having in mind the necessary flexibility to cope
with unforeseen situations. However, it is understood that each manager is co-responsible for
preparing the resources necessary to the development of the Company as this is also part of his
accountability.

Regular counselling and guidance are the best tools for improving performance and for helping
people develop their skills. It also allows to correct errors swiftly and to transform them into a
positive learning experience. In an organisation with flat structures this supports better
delegation. Direct personal contact should always been given preference over written
communication whenever possible.

Each manager has the duty to act as a mentor for his employees.
Formal assessment should take place on a regular basis, preferably once a year. Its purpose is to
provide feedback on past performance and future potential as well as on other relevant aspects
concerning a staff member’s work including the development of his skills and competencies.
Both the positive and negative aspects of individual performance should be frankly addressed.
Assessment of performance should be based on facts rather than opinions. For managerial
positions, assessment will be based essentially on agreed objectives and their level of
achievement.

Efficient performance management emphasising the achievement of agreed objectives is a

prime responsibility for each manager. The necessary time should be dedicated to the
monitoring and the follow-up of the progressive achievement of objectives during the year.
This feedback is meant to stimulate performance and should take place through an open
dialogue based on mutual trust and willingness to progress. It is requested to provide written
evidence of such meetings. Focus should be essentially on continuous improvement,
appropriate training measures but also on shaping a stimulating working environment. In case
of serious underperformance, a termination of employment should be envisaged. Such
termination should be handled with due respect of the person and should include, where
appropriate, separation terms that take into account the employee’s personal situation. When
assessing potential it should be kept in mind that the best indicator of talent is achievement.
Therefore responsibility should be given as early as reasonable to allow people to prove them.
Candidates for managerial positions should clearly have demonstrated their willingness and
ability to apply the Nestle Management and Leadership Principles. Promotions will exclusively
be based on competence, insight, performance and potential with the exclusion of any
consideration for origin, race, nationality, gender, religion or age. Flexibility is a requirement
for ensuring a positive professional evolution. Staff may be requested to move to other
positions. Managers, especially international staff, may be asked to move to other locations.
International experience and participation in group development initiatives such as GLOBE,
SMPT and others can be acquired in all countries of the Group and are a requirement for
holding high-level positions. The development of expertise in specific areas of competence is
determinant for the Company’s success. Therefore job rotation should be practised with
caution. Whilst job rotation might be useful under certain circumstances, it should not result in
weakening our expertise in key areas.

Industrial Relations

Nestle upholds the freedom of association of its employees and the effective recognition of the
right to collective bargaining. Nestle wishes, also through its relationship with unions and other
representative associations, to sustain the long-term development of the Company, both to the
benefit of the employees and of the Company, by maintaining a level of competitiveness
adapted to its economic environment. Industrial relations are a clear responsibility of local
management and will be handled at the appropriate level: first at site level (factories,
warehouse) subsequently at regional or national level, according to local law and practices.
Nestle will ensure that direct and frequent communication is established with its employees,
both union members and non-members, as mentioned in the Nestle Management and
Leadership Principles. Relations with unions will be established under strict observation of
national law, local practices as well as those international recommendations to which Nestle has
adhered to on a voluntary basis as stated in the Corporate Business Principles.

Contacts with union delegates should create a further opportunity to provide information
allowing their members and other representative associations to acquire a full understanding of
the business activities and the goals of Nestle. In accordance with local legislation, Nestle will
refrain from any action restricting the employee’s right to be or not to be affiliated to a union.
Nestle will not engage with any union or other representative association in activities or
discussions other than those relating to employment and working conditions as well as issues
relating to the workplace. Whenever negotiations take place, they will be duly prepared with
the full involvement of line management and take into account both the Company’s and the
employee’s legitimate interest. In dealings with unions, it will be ensured that management
prerogatives be properly maintained

HR Organisation

The fact that Nestle is more people and product than systems oriented is reflected in the way
HR is functioning and is organised. Processes and systems as well as professional HR tools are
there to support HR management but never to the detriment of the human dimension. The
human perspective should be present at all times and under all circumstances. The HR function
should report to the manager responsible for a defined operation (Region, Market, Country, and
Factory) with a functional relation to the market HR according to the size of that operation. The
HR manager should not only have the skills and competencies from a purely professional
standpoint but also have the charisma and the credibility to be a trustworthy partner to her/his
colleagues. Whereas the HR function should indeed provide flawless administrative support, its
main role is to add value to the business and to play a proactive role in every situation where
HR action is required. Specific HR KPIs are useful in assessing the performance of an HR unit.
However, it should be kept in mind that the HR contribution aims in the first place at
optimising the overall company performance through improving people performance. With the
evidence that the human capital is of increasing importance, HR plays indeed a pivotal role in
the conception and implementation of the people strategies that impact financial results and the
organisation overall reputation and effectiveness.

HR PRACTICES AND POLICIES- HUL

Our total employee strength, as of December 31, 2009, was 15,466. We also had 18,210
variable manpower including 800 fixed-term and temporary contract employees. We encourage
employment of local residents in our manufacturing operations depending upon availability of
skills. Our employee relations policy recognises the freedom of association and collective
bargaining. Our company follows a collective bargaining process while finalizing long-term
settlements in all supply chain units. All the workmen at the supply chain units are organised
and are represented by various unions/authorised representatives in their units. In 2009, 10,018
employees were covered under collective bargaining agreements across manufacturing
operations and offices.
We have witnessed 4.9% voluntary attrition amongst managers and 9% amongst officers in
2009. The total rate of employee turnover (total exits due to resignation, retirement, demise,
early retirement) in 2009 was 10% for managers and 14% for officers. The rate of turnover for
workmen in our operations was negligible.

Child labour
Our recruitment policy doesn't permit engagement of child labour directly or indirectly. Regular
audits ensure compliance at our own sites and at third party locations/sites.

Forced or compulsory labour

The Employee Relations Policy and business principles adopted by the company prohibit such
practices and this is upheld in letter and spirit.

Rights of indigenous people

We haven't witnessed any violations of the rights of indigenous people and none of our sites are
at risk of violating such rights.

Diversity
We are committed to maintaining diversity in our working environment. We aggressively
pursue the target of increasing the proportion of women in management cadres. We have a
number of gender-friendly policies such as Maternity Benefit, Career Break, Flexi-working,
Agile Working from remote location, Sabbaticals, Part-time work and Career Breaks. In 2009,
19% of our managers and 9% of our officers were women. Our eight-member management
committee has a woman member.
Our formal employment and fitment policy absolutely prohibits gender-based discrimination.
No incidents of discrimination or complaints have been reported in 2009.
We are a merit driven organisation and this is reflected in the policies concerning recruitment,
training, and promotion which ensure that the best person gets the job, independent of
subjective considerations.

Facilities for full-time employees

Benefits are provided to full-time employees, such as basic access to above-minimum wages,
subsidized canteen facility, safety training and equipment, safe infrastructure and washroom
facilities, irrespective of contractual status. Certain benefits extended as a result of collective
bargaining agreements are available only to those groups of workmen covered by the
agreements.

Notice for operational changes

The minimum notice period for any operational change with respect to terms and conditions of
services is 0-3 weeks, while that for any restructuring activity is 3-6 weeks.

Employee engagement
We maintain good communication channels with employees through company based
information and consultation procedures. We have several processes instituted to ensure a two-
way communication channel. In 2009, we began an employee engagement programme to
ensure that employees are involved in Unilever's vision and plans for the future.
Communication with employees
• CEO report back: Quarterly performance updates from the CEO to the employees.
Conducted at the Head Office, webcast to all sites
• Annual Review: All managers are invited to the Annual Review in four major metros
• Young Managers Lunch with CEO: Every month the CEO meets about 10-15 young
managers and has informal chat sessions about the organisation and receives their
feedback
• A Global People Survey (GPS) of all Unilever employees is conducted every 2-3 years.
'GPS-Pulse', a refined version, is conducted at six-month intervals in the years when a
GPS is not scheduled for managers
• Ur Say: an online portal through which employees can give suggestions addressed to the
Management committee on any aspect of the organisation
• FM-Connect: All factories have FM-connect meetings that invites participation from all
workmen
• Hamara: Our in-house magazine provides a platform to employees to connect, bond,
inspire and express